As board members, it is your responsibility to address all the critical matters of the organization. Most of the time, a decision will come down to a vote. Each board member has the right to vote on any decision that is being made by the board.
Voting in and of itself comes in different forms: a written vote (ballot), Video or Teleconference, a board portal system, and many more. Nowadays, more and more boards are voting using technology that eases the voting process while lowering some of the barriers that can hinder the vote — often the lack of a full quorum.
It is important to note the seriousness of individual board members’ voting responsibilities. If something were to occur that would hinder the company, each member could face personal liability for the organization. This is why each vote counts and is as important as another member’s.
In recent history, many boards have turned to majority voting when it comes to decision-making. The reasons for this have been argued over the last decade by many people. It is important to note, however, that if majority voting is the way you do things then again, each vote matters.
What do boards vote on?
Boards tend to vote on a variety of topics, from day-to-day management activities to long-term strategy implementation. While every board is different, there are some common topics you will probably being voting on. These can include:
Strategy and structure
One of the big umbrella-topics voted on are the strategies and structures of the organization. Some strategies might revolve around the implementation of new marketing campaigns. Some structural votes may look at creating or removing new departments.
Management of funds
All board members will face a financial or budgetary vote eventually. These votes will come in many forms: approvals for fund release, budget approvals, and many more. These votes, if recorded correctly, a crucial for accountability, as the board will have a complete record of what was approved.
Seriously, while you will get common ones like above, you will also get all the other ones in between. You could be voting on what goes in the company vending machine, or if you even should have one. You might have to vote on whether Ted from Accounting deserves to get fired because he took some pens home.
You may find that the most common thing you vote on falls into the ‘everything else’ category. The mundane stuff. The stuff that seems irrelevant and makes you feel like you’re wasting your time. This stuff may bore you, but it’s important none the less.
Quick take: Voting rights
Your members’ voting rights are usually laid out somewhere, mostly in shareholders agreements for for-profit organizations. In most cases, what types of resolutions and minimum votes are explained as well.
There are three types of resolutions that voting boards will use: ordinary, special, and unanimous. An ordinary resolution is the most common and is used to keep the organization moving without every member agreeing. A special resolution will typically require at least 75% of the board to vote yes. A unanimous resolution is pretty self-explanatory, and is most commonly used for organizational level changes.
Voting is complex and understanding how it works is essential for board members to understand. If you’re unclear, check your shareholders’ agreements or consult another board member.